Why The Outsourced GC Model Works for Both Scaling Businesses & Attorneys

Let’s talk about fractional executives. It’s a concept on the rise across many industries. Fractional CFOs, CMOs, Security leaders (CISOs)… if you can think of the title, you can find a “fractional” executive to fill the role. For scaling businesses and companies that need experienced leadership, but don’t have the demand or budget to hire someone full time, a fractional executive is a fabulous solution. These professionals bring the expertise, advisement, and management experience businesses need, without the big commitment and salary.


This model has been proven with most executive titles, and we’re betting big that it works for companies that need legal leadership too. Up until recently, businesses would outsource all of their legal needs to law firms until it became economically prohibitive (that’s fancy for “it costs too much.”) The next option was to hire in-house general counsel. For most growth-stage companies, the need isn’t really there to justify this hire, but the perception is that it may be less expensive than what they were paying law firms or will get them more proactive and practical legal. 


The kicker is, in-house GCs don’t do everything when it comes to fulfilling their employers’ legal needs, which means they’re still outsourcing much of the work to law firm partners. In the end, hiring an in-house GC is only an intelligent use of resources if your company actually needs what they offer — full time. It’s also not the best option for the attorney. Many lawyers go the in-house route when they burn out on the law firm model. They find that being in-house counsel has its own limitations and golden handcuffs. It’s sort of like jumping out of the pot and into the fire.


Most scaling companies don’t need a full time GC, and many attorneys discover that in-house work isn’t any less freeing than being at a law firm. For these lawyers and companies, the outsourced GC model works brilliantly.


An outsourced GC can be brought in to the company much earlier in a business lifecycle than a full time GC. The economics of hiring an outsourced GC fit with their needs and budget. Instead of paying a W2 salaried package + benefits + bonuses + options, etc., you can pay a flat monthly fee to an outsourced GC that works within your budget. More importantly, as a small business, you can get the kind of leadership and advisement from a senior attorney usually reserved for bigger companies. When negotiating contracts with big customers and mitigating risk with big competitors (both of whom employ in-house counsel), having an outsourced GC on your team gives you a huge leg up. 


From an attorney’s perspective, being full-time in-house counsel means putting all of your eggs in one basket. You’re expected to be in the office, holding regular business hours, and often putting in extra time (just like at a law firm). You’re expected to be at board meetings, and often you’ll have to wear multiple hats — such as COO. 


As an outsourced GC, on the other hand, you can work with multiple companies, try different levels of engagement, see what you like, and where you excel. If a company isn’t the right fit or if it goes under, it’s not as disruptive to your career. It can be exciting to work with a few different companies at a time, learn from each, and bring best practices to your entire book (which fortunately, won’t be too big to effectively manage). 


For the legal entrepreneurs out there, flexibility and independence are cornerstones of the outsourced GC model that are not a thing when you’re an in-house GC. You can build your practice as big as you want (it’s yours, after all), or keep it contained to just a couple clients at a time. Unlike a traditional solo practice, you don’t have to take on many, many clients just to keep the lights on, bill in 15 minute increments, and spend as much time on new business development as do on the actual work. You’ll have the freedom to be creative, and dive deep into your clients’ businesses. An outsourced GC is as much an executive advisor, who’s part of the growth engine, as they are a lawyer.


The trend towards fractional executives is rooted in practicality. It works for most leadership positions, and Auxana is proving that it works for legal too. 


Are you a company interested in learning about having your own outsourced GC? Check out our resources, or talk to us.

Are you an attorney ready to become a legal entrepreneur? Learn how, for free.